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Shell board confronted by pensioner welfare question from Paddy Briggs

RETIRED SHELL EXEC PADDY BRIGGS

Shell board confronted by pensioner welfare question from Paddy Briggs

Regular visitors may recall my article published in December 2016 Shell cost-cutting plan will undermine the welfare of its pensioners. 

It included an extract from a Facebook posting on the subject by retired Shell executive Paddy Briggs (right). Paddy confronted the Shell board on the subject yesterday. As is evident from the response in the transcript below, they seemed ill-prepared for the question, which compared huge sums paid to Shell directors such as Ben van Beurden with welfare cuts being made to Shell pensioners. As a result of his intervention, the board has agreed to review the issue he raised.  

ROYAL DUTCH SHELL PLC Q&A SESSION AT AGM HELD 23 MAY 2017 IN THE HAGUE.

Royal Dutch Shell Plc Chairman Charles Holliday invites any questions in relation to Resolutions 2 and 3 Directors approval of Directors renumeration policy and report…

First question comes from Paddy Briggs

(From transcription of audio recording by John Donovan.)

Thank you very much Mr Chairman

My name is Paddy Briggs and I worked for Shell for 37 years. I am now a Shell Pensioner. Since I retired I have been active in the interests of my fellow Shell pensioners in various voluntary capacities including four years as a Trustee of the  “Shell Contributory Pension Fund”in the UK.

I would like to place the issue of RDS Director Remuneration in a broader context than just that of performance and “rate for the job”. As a Pensioner and Pensioners’ representative I would assert that we are stakeholders in the Company and potentially valuable promoters and defenders of the Shell brand and what it stands for. I find it difficult to defend the extraordinarily high levels of compensation received by the Directors of the company – the “High Priced Help” that’s become very high-priced indeed! But that is not my principal reason for speaking to you today and seeking an answer to a question.

I am here because it seems to me that when you pay your Chief Executive nearly 9 million Euros for one year’s work – with the suggestion that this could burgeon with bonuses to almost twice that figure – you need another context in respect of your discretionary expenditure choices. One such context is your 29,000 member Pensioner community in the UK.

In 2016 we received an annual average pension of around £16,000. It may surprise you to know that most of us manage to live quite well on this modest amount. This is not a complaint.

The Shell Pension Funds exists to pay our pensions from their resources. However Shell in the UK has always taken a view that it has a duty of care to its former employees which goes beyond what the Pension Funds are obliged to do. There are various ways that this has been done – I would like to draw attention to one. For decades Shell in the UK has funded and supported managerially an activity called the “Pensioner Liaison Representative (PLR) scheme”.

Some forty ex-employees, known as PLRs, in return for a notional salary and expenses, provide support to the 29,000 pensioner community. This includes home visits which have helped to identify problems that individual pensioners may have. Some of these pensioners are in poverty and Shell has a charity to help those who a PLR identifies as being in financial need. It is a wholly admirable activity and one that Shell can be proud of. It costs in total a little under £1m per annum to run – around one tenth of Mr Van Beurden’s annual compensation.

At the end of last year as part of a review of expenditure in the UK, especially discretionary expenditure, Shell summarily decided to stop the PLR Scheme – saving £1m by withdrawing forty people from pensioner liaison work and making them redundant. One of the reasons given was the need to “adjust to the reality of a lower oil price”. I note that this reality appears not greatly to have affected Directors’ remuneration!

Discussions have been underway between Pensioner representatives and the Company to try and find a way to plug the gap caused by the precipitate removal of the PLR scheme. But I would ask this meeting and the RDS Board whether they truly believe that cancelling this scheme – which costs Shell just some £35 per pensioner per annum – is justifiable in the context of the very high levels of Director Remuneration this meeting is being asked to approve. And I would ask whether Shell’s oft declared gratitude to its former employees/pensioner stakeholders is so much pie in the sky – or “Flauwe kul” as you might say here?

Response by the Chairman of Royal Dutch Shell Plc Mr Charles Holliday:

Thank you for your comments and we care greatly about our pensioners… they’re very important… long employment by Shell is highly valued. The board hasn’t reviewed the specific action you’re talking about.. we’ll take it away and take a hard look at it… please make sure we have your information at the front of the desk out here so that we can follow up with you

Paddy Briggs replies:

Thank you very much.

SPONTANEOUS APPLAUSE FROM SHAREHOLDERS

TRANSCRIPT ENDS

Paddy Briggs worked for the Oil Company Shell for 37 years, retiring in 2002 to pursue other interests.  He has a monthly column in the pensions magazine Pensions Age (“Pensions People”) and was for four years one of two pensioner-elected Trustee Directors of the £13 billion Shell Contributory Pension Fund.

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